Financing real propertyPrint

In Poland it is possible to buy a flat or house for cash or with the help of a loan. Average prices of flats in individual towns are available here ->

The conclusion of a loan agreement is a confirmation of receiving a loan and of a commitment to repay it. However, before signing such agreement, it is worth checking the market and selecting the bank with the most beneficial offer. In Poland there are many banks offering loans on various terms and conditions. Banks charge various interest rates, commissions and other fees. The buyer should also learn about potential additional requirements used by financial institutions when granting loans to people who are not Polish citizens. In the case of foreigners the banks may use special loan conditions including:

  • higher down payment,
  • shortened loan period,
  • higher interest rate and other bank charges,
  • the requirement to have an attorney-in-fact in Poland,
  • the requirement to have a postal address in Poland,
  • the requirement to file a set of documents translated into Polish.

The loan is granted provided that the borrower meets the requirements of the given bank and is creditworthy, i.e. able to repay instalments regularly. The main requirement is to be employed pursuant to an employment contract. The period of repayment of mortgage loans is often longer than ten years and instalments are paid monthly.

After granting the loan, the bank makes an entry establishing a mortgage in favour of the bank in the land and mortgage register of the premises -> Until the entry in the land and mortgage register -> becomes final (which usually takes 3 to 6 months) the bank takes out insurance against the risk of non-repayment of the loan by buying bridging insurance. This insurance secures the risk related to loan repayment from the date of payment of the funds to the borrower to the date when the entry establishing mortgage in favour of the bank in the land and mortgage register becomes final. The cost of the insurance is covered by the borrower. During the period of bridging insurance the interest rate on the loan is increased by 1-2 percentage points.

In order to obtain detailed information about the offer of banks it is best to contact bank offices directly. Portals comparing the offers of individual banks and estimating the creditworthiness of the given person are also available on the Internet. However, data provided there are of a purely informational nature.